OPEC may cut oil output for first time in five years

martes 16 de julio de 2013 

The Organization of Petroleum Exporting Countries (OPEC) may move to slash its oil production for the first time in five years when it meets in December, responding to the surge in US shale oil.

According to The Wall Street Journal, OPEC could reduce production by half a million barrels a day.

The group’s latest report signaled that the US shale oil boom will cut into its share of the world market in 2014 even as world demand grows at its fastest clip in four years. The International Energy Agency also released a report last week that showed demand for OPEC oil next year will fail to meet its current production of around 30 million barrels a day.

The Journal quoted one delegate from a Gulf country as saying the forecast will likely lead to a reduction in oil output. This delegate has tended to oppose production cuts in the past, the report noted.

Another OPEC delegate told the newspaper that a cut of about 500,000 barrels a day was likely to be debated at the December meeting.

Gulf countries have in recent meetings supported keeping the production ceiling at 30 million barrels a day, seeing production cuts – and a subsequent rise in oil prices – as detrimental to Western customers that are still fighting economic headwinds.

OPEC aims to maintain production levels that keep prices from falling below $100 a barrel.

OPEC last cut its oil output in late 2008, when it reduced production by 4.2 million barrels a day. At the time, oil demand fell and prices crashed amid the financial crisis.

Last week’s report said a drop in demand for OPEC crude will coincide with a surge in oil supply from countries outside of the group. Non-OPEC crude is expected to grow by 1.1 million to 1.3 million barrels a day next year, rising at a faster clip than global demand.

Despite anticipated pressure from US shale oil, OPEC may opt against cutting production if oil prices remain above $100 a barrel, the first delegate told the Journal.

On Thursday, the IEA estimated the need for OPEC crude would be just 28.85 million barrels a day in the first half of 2014, and about 29.4 million barrels a day for the whole year. Some of this demand could also be satisfied by drawing oil out of inventories, the IEA said.

The drop in demand for OPEC crude will come as oil supply from countries outside the group, estimated to grow by between 1.1 million barrels a day and 1.3 million barrels a day in 2014, rises faster than global demand.

World oil prices fell on Monday on news of an economic slowdown in top global energy consumer China, analysts said.

Brent North Sea crude for delivery in August slipped 60 cents to stand at $108.21 a barrel in London midday deals.

New York’s main contract, West Texas Intermediate (WTI) for August, dipped 67 cents to $105.28 compared with Friday’s closing level.

“Crude oil prices slid lower on Monday, opening the week on the negative side, as disappointing Chinese economic data hurt market sentiment and limited risk appetite, prompting investors to lock in recent gains,” said Kash Kamal at Sucden brokers.

“The fairly poor Chinese data verified concerns about a slowdown in the Chinese economy which could result in a lack of oil demand in the third quarter of 2013,” he added.

China’s gross domestic product expanded 7.5 percent in the April-June quarter, official data showed on Monday, a second consecutive slowdown in growth. That was slower than the 7.7-percent growth in the previous three months.

The in-line reading provided brief support for oil prices on Monday, before profit-taking set in.

Brent rallied to $109.17 a barrel, attaining the highest point since early April, while New York crude came close to recent 15-month highs.

“The main thing is that it didn’t miss the estimates,” Kelly Teoh, market strategist at traders IG Markets in Singapore, told AFP.

While the second-quarter figure is in line with a median forecast of 10 economists surveyed by AFP, it follows a series of weak numbers pointing to trouble in the Asian giant, with analysts saying it could miss Beijing’s 2013 target.

Beijing unveiled figures also showing an increase in wages, which Teoh said was in line with the government’s efforts to boost domestic consumption as an economic driver to take up the slack from slowing exports.

She also pointed to a 13.3-percent year-on-year rise in retail sales in June as a positive sign for domestic demand.

On Monday morning, international crude benchmark Brent was trading at $108.78. Nymex WTI crude was down nine cents at $105.86. 

Intelego es una empresa que usa este medio público, con material propio y recogido en otros sitios web, como centro de recopilación de información donde convergen diferentes puntos de vista y formas de pensamiento sobre las realidades del país y el mundo, por lo que no se hace responsable de las afirmaciones expresadas por columnistas, periodistas, especialistas o líderes de opinión, aquí publicados".